|Time allowed : 3 hours||Maximum marks : 100|
|Total number of questions : 8||Total number of printed pages : 7|
|Note:Answer SIX questions including Question No. 1 which is compulsory. All working notes should be shown distinctly.|
|1.||(a)||Explain any two of the following :|
|(i)||Combined journal entries||(0)|
|(ii)||Sub-division of journal||(0)|
|(iii)||Balancing ledger accounts||(0)|
(5 marks each)
|(b)||State, with reasons in brief, whether the following statements are correct or incorrect:|
|(i)||Depreciation cannot be provided if there is a loss in a financial year.||(0)|
|(ii)||Trial balance ensures the arithmetical accuracy of the ledger.||(0)|
|(iii)||Account sale is a statement sent by the consignor to the consignee.||(0)|
|(iv)||Wages paid for erection of machinery are debited to profit and loss account.||(0)|
|(v)||Receipts and payments account is a summary of all capital receipts and capital payments.||(0)|
(2 marks each)
|2.||(a)||Re-write the following sentences after filling-in the blank spaces with appropriate word(s)/figure(s) :|
|(i)||No depreciation has been charged on machinery. This is an error of ____________.||(0)|
|(ii)||Valuation of closing stock in hand is done at the lower of _______ and___________.||(0)|
|(iii)||Payments recorded in the petty cash book are posted in ________ to ledger accounts.||(0)|
|(iv)||Closing capital is Rs.4,00,000 and opening capital is Rs.3,00,000, but profit ascertained is Rs.1,40,000. There must have been net _________ of Rs.40,000 during the year.||(0)|
|(v)||If a suspense account has been opened, every one-sided error is rectified by passing a journal entry through __________ account.||(0)|
|(vi)||Trade discount is deducted from the ____________ price.||(0)|
|(vii)||When a bill receivable is dishonoured, the amount of the bill is debited to the ____________ account.||(0)|
|(viii)||The period of indemnity in case of fire insurance claims generally does not exceed___________.||(0)|
(1 mark each)
|(b)||Distinguish between any two of the following :|
|(i)||‘Cash discount’ and ‘trade discount’.||(0)|
|(ii)||‘Bill of exchange’ and ‘promissory note’.||(0)|
|(iii)||‘Trial balance’ and ‘balance sheet’.||(0)|
(4 marks each)
|3.||(a)||Choose the most appropriate answer from the given options in respect of the following :|
|(i)|| Opening entry is passed with — |
|(ii)|| The following error would not affect the profit — |
|(iii)|| Which one of the following accounting concepts treats owner of the business as creditor of the business — |
|(iv)|| The process of entering transactions in the ledger is called — |
|(v)|| If a payment is made on a bill on due date, then it is called — |
|(vi)|| Trading account is a part of — |
|(vii)|| Revaluation account is prepared to find out the profit or loss on — |
|(viii)|| When depreciation is charged equally year after year, it is known as — |
(1 mark each)
|(b)||Explain any two of the following statements :|
|(i)||In the absence of partnership deed, provisions of the Indian Partnership Act, 1932 are applied.||(0)|
|(ii)||Single entry system of book keeping is unscientific, incomplete and defective system.||(0)|
|(iii)||Every transaction has debit and credit aspects.||(0)|
(4 marks each)
|4.||(a)|| Rim Zim Ltd. maintains a current account with the State Bank of India. On 31st March, 2010, the bank column of its cash book showed a debit balance of Rs.1,54,300. However, the bank statement showed a different balance as on that date. The following were the reasons for the difference : |
|(b)||On 1st April, 2005, a company acquired a lease of land for a term of 5 years at a cost of Rs.4,00,000. It is proposed to depreciate the lease by annuity method charging 5% per annum interest. |
Show the lease account for the entire period of 5 years. A reference to the annuity tables shows that to depreciate Re.1 by annuity method over 5 years, charging 5% per annum interest, one must write off a sum of Re.0.230975 every year.
|5.||(a)|| Amar, Akbar and Anthony were carrying on a business in partnership, sharing profits and losses in the ratio of 2:1:1 respectively. They took a joint life policy for Rs.1,20,000 on 1st April, 2006. The annual premium of Rs.5,000 was payable on 1st May every year. The last premium was paid on 1st May, 2009. Akbar died on 10th June, 2009 and policy money was received on 31st July, 2009. |
The surrender values of the policy as on 31st March in different years were as follows :
Prepare joint life policy account for the entire period assuming that the joint life policy was maintained at its surrender value and the accounts were closed on 31st March every year.
|(b)|| The following information is available from Sachin, who maintains books of account on single entry system : |
Sachin withdrew Rs.5,000 from the business every month for meeting his household expenses. During the year, he sold investments held by him privately for Rs.35,000 and invested the amount in his business.
At the end of the year 2009–10, it was found that full year’s interest on loan from Mrs. Sachin had not been paid. Depreciation @ 10% per annum was to be provided on furniture for the full year. Shop assistant was to be given a share of 5% on the profits ascertained before charging such share.
Calculate profit earned during the year ended 31st March, 2010 by Sachin.
|6.|| The following is the summary of the cash transactions of a literary society for the year ended 31st March, 2010 : |
At the beginning of the year, the society possessed books worth Rs.2,00,000 and furniture valued at Rs.85,000. Ordinary subscriptions in arrear at the beginning of the year amounted to Rs.3,500 and at the end of the year Rs.4,500. Six months’ rent, Rs.6,000 was due both at the beginning and at the end of the year. Provide Rs.5,000 as depreciation on furniture and Rs.11,300 as depreciation on books.
Prepare the society’s income and expenditure account for the year ended 31st March, 2010 and its balance sheet as on that date.
|7.|| From the following balances extracted from the books of Karan and the additional information, prepare the trading and profit and loss account for the year ended 31st March, 2010 and also show the balance sheet as on that date : |
Additional information :
|8.||(a)|| Ajoy of Agra and Bijoy of Bijnor enter into a joint venture to consign 200 bales of cloth to Dinesh of Delhi to be sold on their joint risk which is in the proportion of 3/7 and 4/7 respectively. Ajoy sends 150 bales of cloth at Rs.2,600 each, paying freight and other charges Rs.4,900. Bijoy sends 50 bales of cloth at Rs.2,500 each, paying expenses amounting to Rs.3,600. All the bales of cloth are sold by Dinesh for Rs.14,00,000 out of which Dinesh deducts Rs.6,000 for expenses and 10% on total sales as his commission. Dinesh remits Rs.3,00,000 to Ajoy and the balance to Bijoy through bank drafts. |
Prepare joint venture account and the accounts of Bijoy and Dinesh in Ajoy’s ledger.
|(b)|| A merchant closes his books every year on 31st March. A fire occurred in his premises on 16th May, 2009 and stock costing Rs.38,000 only could be salvaged. Using the following additional information, prepare a statement showing the amount of claim to be lodged with the insurance company : |